Credit crunch hits Alfa Laval

Alfa Laval AB, the world?s biggest maker of heat exchangers, said it will cut 1,000 jobs in the first half after a number of ship builders cancelled orders. The marine and diesel business lost 7 % of its order backlog to cancellations in the last three months of 2008, the Lund, Sweden-based company said in a statement. Alfa Laval will cut production by 10 to 20 % this year, spokesman Peter Torstensson said.

Alfa Laval got almost a fifth of its 2007 orders from the marine and diesel equipment market, which is falling from historically high levels as the credit freeze cuts loans to shipyards. Hyundai Heavy Industries had no orders for new vessels for three months since October as trade in iron ore and consumer goods plunged.

“We?re taking capacity down from a quite high level and it?ll vary in different units depending on their backlogs,” Torstensson said. Much of the equipment intended for ships can be refitted for other uses, he said.

The company said 700 of the job cuts will take place outside Sweden, and it will also trim the number of contract workers and consultants.